LG Chem, GM to invest $2.3 billion in EV battery venture

South Korea’ LG Chem will form a joint venture with US carmaker GM to mass produce battery cells for electric vehicles including a new battery-electric truck that will be launched in 2021, according to LG Chem on Dec. 6.

“The joint venture signing (today) is more than just a collaboration, it’s the beginning of a great journey,” said LG Chem CEO and vice chairman Shin Hak-Cheol.

The two companies said they will invest up to a total of $2.3 billion into the new joint venture. They will also establish a battery cell assembly plant on a greenfield manufacturing site in the Lordstown area of Northeast Ohio that will create more than 1,100 new jobs and ultimately attain production capacity of up to 30GWh. Ground-breaking is scheduled for mid-2020.

GM has been supplied by LG Chem with lithium-ion batteries for at least a decade, beginning in 2009. The relationship included LG Chem being selected as the sole supplier for Chevrolet’s Bolt.

The latest joint venture comes after GM after proclaimed its shift to the electric vehicle space. GM chairman and CEO Mary Barra said the company is on track to introduce 20 electric vehicles globally by 2023.

“It’s got to be affordable to drive the volume and really drive EVs in the marketplace, and customers are looking for affordability. And so that is the journey we are on and we think working with LG is will accelerate that path.”

For LG Chem, the deal would give a boost to its battery business, which Shin said would grow to $25 billion by 2024. Currently, LG Chem’s EV battery production capacity is about 70GWh, and will grow to 100GWh by 2020. LG Chem will also now have seven production facilities.
 

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